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Sri Lanka share slide ends on telecom gains

July 09, 2008 (LBO) - A slight recovery in the price of heavyweight Sri Lanka Telecom ended a lengthy slide in the Colombo stock market indices Wednesday but turnover was thin. Brokers said the negative sentiment was likely to continue with record inflation and high interest rates hurting consumers and companies alike.

The All Share Price Index ended up 0.38 percent (9.11 points) at 2,381.61 while the more liquid Milanka closed 0.


27 percent (7.71 points) higher at 2,857.33. Turnover was 108 million rupees.

Sri Lanka Telecom ended 75 cents up at 41.


75 rupees while Dialog Telekom closed flat at 13.50 rupees.

Srimal Liyanage of brokers Lanka Securities said trading in Chevron Lubricants Lanka was the highlight of the day with news that the company plans to significantly increase its business in the Bangladesh market.

The stock ended up 50 cents at 105.25 rupees with 156,200 shares traded.

Liyanage said there was some improvement in retail activity although turnover was thin.

"In the past few weeks there were low activity levels in the retail segment but today there was some improvement with active trading in small to mid cap stocks."

But the market was likely to slide given the tough business conditions that would affect corporate profitability.

"If the current economic and business conditions continue, the long-term trend is downward," he said. "The high interest rates would discourage investment and be detrimental to business, as their profitability would be affected.
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